Market strategist Barry Ritholtz discusses the outlook for the financial markets and how disappointing corporate earnings and the possible 'fiscal cliff' are likely to impact stocks. Photo: Getty Images.

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... the ... dateline Simon Constable ... a Stella CY Tambo ... stocks have taken it on the chin and since all of us what's it mean for your investments and when will the downdraft and hit a tells all about it is ... Renault's the one and only thank you Brian much for being now and I love the time ... thanks ... to its full this is my knee ... but some gold leaf tie in the ... psyche that mean ... it's it's a was crabby so we've we've seen some of the ... reason we ... you know ... that outlooks from companies and great earnings is this the beginning of something new ... it very well could be local to this um ... cyclical bull market that began in March or nine ... it's getting ... long in the tooth it's it's well over forty months old ... think the typical bull cycle runs about thirty six to thirty nine ... months that they can go longer ... but I you know you you look at the global recession it's pretty clear that the companies ... that have been either missing on revenue warm glowing their forecasts ... are doing so of course the appliances we see weak Europe we see weak Asia ... by the US is is the cleanest shirt in the hamper so to speak but that's not saying a whole lot ... it's coming or not ... I mean the greatest return to the IPO though the sale was a was ... it so right on a relative basis you know the joke is in the land of the blind the one eyed man is king well everybody else is doing all full ... with doing mediocre but by compassion it looks pretty good one of this fiscal cliff that we we keep hearing about coming on his back or is that was part of what is causing these companies to say OK piano looks bad when an investor so some of the family aam mediocre ... I've traveled its record high on the business side I don't think the fiscal cliff is his first little think it's the harsh show that everybody is preventing it is ... you know you look of the eleven minus ... five to some degree look at the ... three aspects tax revenue ... entitlements in defense spending when you'll get all three of them on a federal raises taxes so the lows that in in half a century when you look at the Defense Department we spend more than I ... they keep changing the number but ... the next twenty two countries combined a full nineteen our allies ... and in terms of entitlements we have a very expensive Social Security ... and Medicare may take Medicaid ... set of programs that nobody wants to do the adult thing and say Hwy Gatorade's that's a little bit we are cognizant spending with a cut ... entitlements a little bit ... until that happens within have this ongoing overhang ... the fiscal cliff ... both of you wanting deficits and increased ... at a controlled Congress so essentially ... if it forces everybody to the table to make ... some sort of grand compromise I don't see that as a terrible thing to the bank could be kidnapped from the dead parties but only if we go into SciQuest ration if the kids them don't ... behave like adults while big cuts in defense big tax increases ... the entitlement cuts equals of pretty healthy recession ... I've that won't start January first but as we go through the air ... you'll see all of the earnings accelerate to the downside so based on what's happening now in October how would you suggest people make their investments should they be put Getting going into defensive stocks gain on the YouTube in utilities consumer staples things like that well ... two things to keep in mind based on what's been happening were still three percent ... four percent away from ... the prior multi year highs ... so it's not like oh my God what we do the market's getting killed when you're that close to highs it's it's premature to ... make radical changes in your portfolio ... that said we came into the year overweight equities last quarter we moved ... to equal weight equities ... moving in the direction of going a little underweight equities is no worse than in the war all cash price of oil ... wells oil cash them but you know when we look in certain sectors when you look good ... the health care sector XLV which by the way has winners or losers regardless of who wins the election ... to hospital insurers would be helped by Obama other aspects would be helped by a Romney ... um that's not a bad place to hide new mentioned health care and consumer staples Johnson Johnson ... is a little bit of both so there are places to to ... try and ... stop the storm a little bit assuming we get a full blown storm ... was a pleasure thank you Brian much Barry Ritholz we really appreciate your time ...